Which transfer-pricing method is useful for determining full cost of products and services?
A)Cost-based.
B)Negotiated.
C)Market-based.
D)Minimum-based.
E)Maximum-based.

Question

Quizplus · Accepted Answer

The cost-based transfer-pricing method is useful for determining the full cost of products and services. This method involves transferring the cost of producing the product or service to the related party. It includes both variable and fixed costs and is considered to be the most appropriate method when there are no comparable market transactions or when the market-based method is not feasible.

Which Transfer-Pricing Method Is Useful for Determining Full Cost of Products